| Many Americans today don't have a savings account | | | | Make sure you do some comparison shopping before |
| or emergency fund. I heard on the news recently that | | | | opening an account for your emergency fund to |
| the Commerce Department reported that Americans | | | | ensure that there are no minimum or other fees for |
| spend all the money they have and personal savings | | | | accessing your account. A good source to use is |
| rates have reached the lowest level since the Great | | | | You can start off by contributing small amounts to |
| Depression. | | | | your emergency fund until you are able to contribute |
| Your emergency fund is your safety net: in case you | | | | more. Start off with a contribution of at least $20 a |
| get sick or lose your job you can use your emergency | | | | month to your emergency fund. Once you are able to |
| savings to hold you for a few months until you can find | | | | contribute more to the fund do so. Make several |
| a new job. | | | | short-term goals for your emergency fund. Once you |
| Your emergency account should be separate from | | | | have saved enough money to pay one bill, pat yourself |
| your checking or savings accounts and should only be | | | | on the back. Then keep saving until you have enough |
| used for emergencies such as an unexpected | | | | to pay three bills and so on, until you have enough |
| expense, unemployment, medical bills, etc. | | | | saved to pay your bills and expenses for 3 to 6 |
| An emergency fund should be enough savings to pay | | | | months. |
| your bills for at least 3 to 6 months. Money for an | | | | Once you have reached your emergency fund goal, it |
| emergency fund should be readily accessible and | | | | is time to start developing some long-term goals such |
| stored in a checking or savings account, preferably a | | | | as an additional savings account and to start planning |
| high-interest savings account, such as Emigrant Direct | | | | for retirement. A great site to learn about retirement |
| or ING or a money market account where you can | | | | planning is and look under the Personal Finance section. |
| make money while saving money. | | | | Having an emergency fund will ensure that you are on |
| To determine how much money is needed to pay 3 to | | | | the road to becoming financially secure and will |
| 6 month's worth of your bills do an inventory and write | | | | prevent you from going into debt when an unexpected |
| down all your bills and expenses and the monthly | | | | tragedy happens or unexpected expenses arises. An |
| amount spent for each. Calculate the total. Use this | | | | emergency fund is the first step to getting out of and |
| amount and multiple by 3 or 6 to determine the total | | | | staying out of debt. |
| amount you need to save in your emergency fund. | | | | |